BITCOIN STARTS 2022 IN FREE FALL
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Greetings my dear members of this recognized platform @ProjectHOPE, 2022 begins with free fall for bitcoin, since during this first week this cryptocurrency has only registered a downward trend that has everyone on the platform to the expectations and here I will present some of the possible reasons why this is happening then I will present them.
INTRODUCTION
The bitcoin is a cause for alert in this new year, since its price has plummeted to such an extent that makes us go back to the days of September 2021, taking into account that in this same month it reached its highest price in the history of bitcoin, a fact that greatly favored many of its followers.
But not everything has been positive for this cryptocurrency, as everything in this volatile market so far this year, bitcoin has registered a peak fall that so far registers 42,000 USD and it is estimated that this price will continue to fall as a result of the Internet outage recorded in Kazakhstan, which is one of the main countries where the most important currency in the world is mined, this and more will be developed in the following text.
BITCOIN PRICES IN JANUARY
In the few days of this new year this cryptocurrency has presented values close to 49,000 and 50,000 USD, this value fell during January 2 to 47,000 USD and then went like a stone to the bottom of the water to reach a value of around 42,000 USD, a price very similar to that recorded in September 2021 when it also had a fall to 42,634. The great concern lies in the fact that during last year in the month of January this cryptocurrency was at a price close to 35,000 USD.
It should be noted that by the end of 2021 it was expected to break its historical price again, since many analysts indicated that it would reach a value close to 100,000 USD and it has been quite the opposite, since after the maximum value recorded in the month of September this cryptocurrency has been in continuous decline until reaching 42,000 USD. This confirms once again the financial volatility of these cryptocurrencies, which do not always meet the predictions expected for the moment, and certain factors that will be discussed later play an important role in this field.
FACTORS INFLUENCING THE VALUE OF BITCOIN
One of the elements that have influenced the fall of this currency are the political conflicts due to the lack of fuel that have been registered in Kazakhstan, where there is currently no internet service, which is of great interest in the mining process. After all the controversies that China established due to cryptocurrency mining, this country has become the second place where the bitcoin network is processed.
Another very important factor is the appearance of the new variant of the coronavirus (Omicron), which has generated doubt and uncertainty in the financial field for fear of a new wave of this virus that continues to claim lives and wreak havoc in its path. However, even with all this, there are those who remain optimistic and indicate that this year will have positive effects on bitcoin and therefore this will impact the finances of cryptocurrencies.
The publication of the points discussed during the month of December in the meeting established with the (FED) United States Federal Reserve System, where an increase in the interest rate is indicated has also played a determining role in the fall of the value of bitcoin.
EXPECTATIONS FOR BITCOIN IN 2022
Even with the recent scenario that has been presented in the financial market with Bitcoin, its promoters do not lose hope that in the first quarter of the year this currency will again break its historical record and double its current value.
In this sense, Goldman Sachs analyst Zach Pandl, infers that this cryptocurrency can displace gold and therefore reach a value close to 100,000 USD, on the other hand there are those who disagree with the analyst and indicate that bitcoin cannot displace gold because it represents a currency with a lot of volatility in the market.
Likewise, according to Mike McGlone of Bloomberg Intelligence, he believes that the upcoming extinction of the Fed, far from harming bitcoin in the long run will benefit it, since it is a very volatile and speculative currency and if its risk level decreases, the Fed will lower inflation levels, positively impacting bitcoin, which will become a global reserve currency.
FINAL CONSIDERATIONS
As we have mentioned throughout this writing, cryptocurrencies represent a financial area with a lot of volatility and it is normal to observe these sudden changes in the value of Bitcoin, however, there are certain mitigating factors that have dragged this value even more and one of the most prominent is the obstacles placed by China in the mining of Bitcoin, which made this mining move to Kazakhstan and this now presents conflicts of interest that are also affecting the bitcoin mining process.
But even with all these risk factors, there are optimists who indicate that bitcoin is only going through a rough patch and then a bullish period that will double its current value and then some.
MATERIAL CONSULTED
Bitcoin price collapsed: why it fell almost 10% in the last 24 hours. Fuente:
Where bitcoin could be headed in 2022. Fuente:
What's happening with Bitcoin and why it is plummeting. Fuente:
Greetings @sidalim88, I really liked your article, I enjoyed reading it, the truth is that this fall of BTC at the beginning of the year was unexpected, we thought it had already lowered its price and would remain in an accumulation zone, but due to different events in the world its price fell one more step, now it is time to wait for its recovery.